Broward County

Cuban delegation arrives amid threats by Gov. Scott to cut funding to ports that sign pacts

Governor Scott talks about port in Florida doing business with Cuba

Rick Scott, Governor of Florida, comments on ports in Florida doing business with the "ruthless dictator" Raul Castro". The governor was in Fort Lauderdale today to announce tax cuts for this year's budget.
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Rick Scott, Governor of Florida, comments on ports in Florida doing business with the "ruthless dictator" Raul Castro". The governor was in Fort Lauderdale today to announce tax cuts for this year's budget.

A high-level Cuban business delegation toured Port Everglades and met with port officials Thursday, although the planned highlight — the signing of a cooperation pact — was canceled after Gov. Rick Scott threatened to cut off state funding to any port that entered into an agreement with the communist-ruled island nation.

The Port of Palm Beach also called off its plans to ink a Cuba deal Friday, citing the governor’s stance.

Scott said Wednesday that he would ask Florida legislators to restrict funds for ports that “enter into any agreement with [the] Cuban dictatorship.” That risked $37 million this fiscal year for Port Everglades, which is in Fort Lauderdale — and potentially $125 million over five years — and $920,000 this year for the Port of Palm Beach.

Although the Legislature, which sets the state budget, could ignore the governor’s request, the possibility was worrisome enough that Port Everglades leaders huddled for most of the day Wednesday considering their options.

At issue was a non-binding memorandum of understanding that was to be signed with the National Port Administration of Cuba. It was to cover future cooperation and could have led to joint marketing studies and training, sharing of data helpful in forecasting future trade flows, and perhaps even joint marketing of Cuban ports and Port Everglades, according to Jim Pyburn, the port’s director of business development.

Port Everglades issued a statement Thursday morning bowing out of the deal.

“The National Port Administration of Cuba has indicated to Port Everglades administration that there is no need for a memorandum of understanding at this time,” the port said. “However, today’s business meeting and related activities will continue as planned.”

The Port of Palm Beach quickly canceled its signing too, citing “a recent request from Governor Rick Scott.”

“The Port of Palm Beach plans to welcome the Cuban Delegation and looks forward to having our tenants learn more about opportunities to expand their businesses,” the port said in a statement. “The Port’s intent and purpose behind receiving the delegation has always been to explore possibilities to expand commerce and trade for our tenants.”

Cuban Ambassador José Ramón Cabañas tweeted a photo Thursday of the Cuban delegation’s Port Everglades visit.

“The Governor appreciates the port choosing not to do business with the Castro dictatorship,” Scott spokeswoman Jackie Schutz said in an email to the Miami Herald.

After a meeting with Port Everglades Director Steve Cernak, the seven-member Cuban delegation toured the facilities, viewing the site where the port hopes to dredge so it can handle the big ships that now traverse the expanded Panama Canal, and its cruise facilities.

“I think the event went well ultimately. It was really about putting the business community together for a discussion,” Cernak said.

After discussing the MOU with the Cuban delegation, he said, “We agreed to put off the signing.” But he said the flap over the MOU pointed up the need for more dialogue.

Members of the Cuban delegation said they would still like to see the MOU signed when it’s possible.

“The United States is our natural market and very close to us,” said Eradis González de la Peña, president of Almacenes Universales, a Cuban logistics company that oversees the Mariel Container Terminal and the port.

“Our interest is to insert the port of Mariel and the Mariel Economic Development Zone into the logistical corridors of the ports of the United States and become part of their supply chains,” she said.

“We thought signing the MOU would be a first step in realizing this goal. We’ll keep on working on it,” González said.

As for Scott’s comments, she said: “As a governor, he has the right — and what’s more we respect that.”

The Cubans lunched with executives from the cruise lines and Crowley Maritime, which has been offering shipping service to Cuba for the past 15 years, and planned to cap the day with a “Doing Business with Cuba” seminar for about 150 members of the local business community.

“The port director was a little upset the way things transpired. Nevertheless he understood the governor’s position,” Broward County Commissioner Chip LaMarca said Thursday morning, minutes after speaking with Cernak. “With respect to the MOU, it was canceled yesterday afternoon once the governor’s position was made.”

The draft of the two-page memo of understanding, obtained by the Herald under Florida’s public records law, says “the parties believe it is in their mutual interest to establish an alliance of cooperation aimed at generating new business by promoting the all water route between Port Everglades” and the ports of Cuba.

“Such new business would help to increase the present level of economic growth by increasing job opportunities and revenues at Port Everglades and increasing revenues at the Ports in Cuba.”

Ellen Kennedy, a Port Everglades spokeswoman, called it a “goodwill gesture” similar to sister seaport agreements that the port has in place with five other ports around the world. “It’s something we were hoping to have,” she said.

When port officials picked the Cuban delegation up at the airport Thursday morning, “they said the MOU wasn’t a big deal,” Kennedy said. “It seemed like they were more interested in the business meeting and forming business alliances and promoting the port of Mariel.”

All container traffic that previously went to Havana has been shifted to the deep-water Port of Mariel. Adjacent to that port, the Cuban government also is developing the Mariel Special Economic Development Zone, where it hopes to attract foreign investment and companies with cutting-edge production capabilities.

Crowley Maritime, Port Everglades’ largest customer, offers a Port Everglades-to-Mariel route three times a month with continuing service to Honduras and Guatemala. It has been offering service from the Fort Lauderdale port to Cuba for the past 15 years, mainly transporting frozen chicken parts.

Cuba trade is hardly new for Florida.

Under exceptions to the embargo that allow food and other humanitarian exports to Cuba, the United States has exported more than 4,806,368 metric tons of products to the island since 2010.

Of that amount, more than 737,155 metric tons have been transported from ports located in Florida, according to John Kavulich, president of the U.S.-Cuba Trade and Economic Council. This represents more than 15 percent of the total transported since 2010.

“Gov. Scott’s comments focus upon the ethics of exporting to countries where the United States has diplomatic and commercial relations but does not share the same political system,” Kavulich said. “For consistency, would the governor oppose port funding for those that assist with exports to China, Vietnam, Turkey and countries throughout the Middle East?”

But over three posts on Twitter Wednesday, Scott said he would ask state lawmakers to restrict dollars for ports that “enter into any agreement with [the] Cuban dictatorship.”

Scott’s tweets came a day after the first legal cargo from Cuba in more than half a century — artisanal charcoal — arrived Tuesday in Port Everglades aboard a Crowley ship. The two containers of hardwood charcoal were produced by private Cuban worker cooperatives, making the Cuban exports legal under rules issued by former President Barack Obama in his quest to normalize relations with Cuba.

The Cuban delegation has already paid visits to ports in Houston and New Orleans, and plans on calling on the Port of Palm Beach, Port Tampa Bay and the Port of Virginia in Norfolk before returning to Cuba in early February.

An earlier version of this story misstated the potential loss in state funding for the ports.